From a 2016 Pilot Project to a Global Real-Time Payments Leader
New Delhi: India’s digital payments ecosystem has undergone a remarkable transformation over the past decade, with the Unified Payments Interface (UPI) emerging as one of the most significant pillars of the country’s digital financial infrastructure.
Developed by the National Payments Corporation of India (NPCI), UPI was designed to create a simple, secure, interoperable and accessible payment system that could be used by citizens, businesses and government institutions alike. From its modest beginnings in 2016, UPI has evolved into a major component of India’s Digital Public Infrastructure (DPI) and has increasingly expanded its presence beyond the country.
Today, UPI is live in 11 foreign countries for UPI acceptance and/or cross-border remittances, with Greece and the Maldives among the latest additions to its growing international footprint.
From Multiple Bank Accounts to One Seamless Platform
UPI fundamentally changed the way people conduct digital transactions by allowing users to operate multiple bank accounts through a single mobile application of a participating bank or payment service provider.
The platform integrates banking services, fund transfers and merchant payments into one interoperable system. It enables 24×7 real-time payments, while security mechanisms such as two-factor authentication and end-to-end encryption help protect transactions.
Its ease of use, interoperability and real-time processing have contributed significantly to the rapid adoption of digital payments across India.
Key Milestones in UPI’s Evolution
2016: Launch of UPI
UPI was launched on a pilot basis in April 2016 with 21 member banks. By August 2016, the system was opened to the public as participating banks began making their UPI-enabled applications available through the Google Play Store.
In December 2016, the BHIM application was launched, enabling users to make direct bank-to-bank payments through mobile devices using UPI.
2017: Dynamic QR Payments
The introduction of Dynamic QR further expanded UPI’s use among retail merchants. Dynamic QR codes could automatically include transaction-specific information such as the payee details and exact transaction amount, reducing the need for customers to manually enter payment information.
2018: UPI 2.0
UPI 2.0 introduced several features aimed at making digital payments more secure, convenient and seamless.
These included Invoice in the Inbox, allowing users to view invoices before authorising payments; Signed Intent and QR, which simplified payment authorisation; UPI Mandates, enabling recurring payments through pre-authorised instructions; and Overdraft Account Linking, allowing users to conduct UPI transactions through eligible overdraft accounts.
2019: Rapid Nationwide Adoption
In 2019, SEBI permitted retail individual investors to use UPI as an alternative payment mechanism for IPO applications through designated intermediaries.
UPI also crossed the landmark of one billion transactions in a single month in October 2019, demonstrating the rapid growth of the platform across the country.
2020–2022: Expansion of Use Cases
The period from 2020 to 2022 witnessed significant expansion of the UPI ecosystem.
UPI AutoPay was introduced to facilitate recurring e-mandates for services such as subscriptions, utility bills, insurance premiums, SIPs and EMIs.
The launch of UPI 123PAY brought feature-phone users into the digital payments ecosystem. The service enabled transactions through mechanisms including interactive voice response (IVR), app-based functionality, missed calls and proximity sound-based payments.
UPI Lite was introduced for faster and PIN-less low-value transactions. The integration of credit cards with UPI further expanded payment options.
During FY 2021–22, UPI processed transactions worth more than US$1 trillion and crossed 5 billion monthly transactions in March 2022.
UPI also began its international expansion during this period with its launch in Bhutan, marking its first cross-border deployment.
2023: Credit Line on UPI
In 2023, Credit Line on UPI was introduced, allowing pre-sanctioned bank credit lines to be linked as a funding source for UPI transactions.
By FY 2023–24, UPI accounted for approximately 70% of India’s digital payment transactions, underlining its central role in the country’s rapidly evolving digital payment ecosystem.
2024: New Features and Higher Limits
The year 2024 brought several important developments.
UPI Circle was introduced, allowing a primary user to authorise secondary users to make payments within predefined transaction limits linked to the primary user’s bank account.
The Reserve Bank of India (RBI) increased the UPI transaction limit for tax payments from ₹1 lakh to ₹5 lakh per transaction. Higher limits were also provided for selected categories such as capital markets, IPO subscriptions, loan collections, insurance, healthcare and education.
The per-transaction limit for UPI 123PAY was increased to ₹10,000, while the UPI Lite wallet limit was raised to ₹5,000, with the per-transaction limit increased to ₹1,000.
2025: Authentication Innovation
In 2025, on-device authentication for UPI was introduced, allowing users to authenticate payments through smartphone-based fingerprint or facial recognition.
Aadhaar-based Face Authentication also simplified UPI PIN onboarding, particularly benefiting first-time users, senior citizens and people who may have limited access to physical payment cards.
UPI Today: Unprecedented Scale
Over the past decade, UPI has experienced extraordinary growth in both transaction volume and transaction value.
Between FY 2016–17 and FY 2025–26, annual UPI transaction volume increased from around 2 crore transactions to more than 24,162 crore transactions, representing an approximately 12,000-fold increase.
During the same period, annual transaction value increased from ₹0.07 lakh crore to approximately ₹314 lakh crore, representing a growth of more than 4,000 times.
The scale of UPI’s expansion is also evident in its latest monthly performance. In July 2026, the UPI ecosystem comprised 741 live banks.
During the month, UPI processed approximately 2,365.8 crore transactions, with the total transaction value reaching around ₹29.87 lakh crore.
These figures highlight the platform’s deep integration into the everyday financial activities of individuals, businesses and institutions across India.
UPI’s Growing Global Footprint
UPI has also emerged as a major player in the global real-time payments landscape.
According to the International Monetary Fund (IMF) report “Growing Retail Digital Payments: The Value of Interoperability,” published in June 2025, UPI accounted for approximately 49% of global real-time payment transaction volume in 2024.
India’s real-time payment platform is now operational across several international markets, including Bhutan, Nepal, Singapore, the UAE, France, Sri Lanka, Mauritius and Qatar, facilitating UPI acceptance and/or cross-border digital payments.
Expansion into New International Markets
UPI’s global reach continued to expand in 2026.
In June 2026, NPCI International Payments Limited (NIPL) partnered with ACLEDA Bank Plc. to launch UPI acceptance in Cambodia, strengthening India’s cross-border digital payment connectivity.
The same month, UPI went live in Greece for cross-border remittances, enabling eligible customers to transfer money between Greece and India instantly and securely through Eurobank.
Another significant milestone came on July 30, 2026, when cross-border remittances between the Maldives Instant Payment System, Favara, and India’s UPI went live. The development marked an important step in strengthening digital financial connectivity and economic cooperation between India and the Maldives.
With these developments, UPI is now live in 11 foreign countries for UPI acceptance and/or cross-border remittances.
A Decade of Digital Transformation
Over the last decade, UPI has fundamentally transformed the way India conducts financial transactions. Its combination of interoperability, real-time processing, convenience, security and continuous innovation has helped bring digital payments into the daily lives of millions of people.
From a pilot project involving 21 banks in 2016 to a system processing thousands of crores of transactions every month, UPI represents one of the most significant examples of India’s digital transformation.
Its expanding international footprint also demonstrates how India’s Digital Public Infrastructure is increasingly influencing the global digital payments landscape.
UPI’s journey over the past decade is therefore not merely a story of technological advancement; it is a story of financial inclusion, digital empowerment, innovation and India’s emergence as a global leader in real-time digital payments.
Source: Press Information Bureau (PIB), Government of India
